Research for the Santander Corporate and Commercial Banking UK Town and City Index focused on five factors considered fundamental for business success - enterprise, talent, commuincations connectivity, costs and well-being.
The study, conducted by Professor Francis Greene at Birmingham University, showed Reading benefits from higher business start-up rates and low levels of population with no qualifications.
It also scored highly for its high employment rate and employee satisfaction, but lost points for low sector diversity and higher than average council taxes.
Overall, the town secured seventh place, while Cambridge took the top spot, ahead of Oxford in second and Edinburgh in third.
Cheryl Adams, regional director for Santander Corporate and Commercial, said: "The future of the economy depends on our businesses and their success and growth.
"Reading has many of the key ingredients that help to support its business community and will have an important role to play in its future success."